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Do Australians ‘get’ China?

An Australian expat based in Hong Kong wrote to me recently after I published a column about diplomatic developments in the Asia-Pacific. The writer’s aim was less to comment on the article’s content than to castigate me for what he considered to be Australia’s multiple shortcomings in China and Asia.

Australian companies and large mutual funds neither invested in the region nor were they present on the ground, he said. Australians didn’t speak the local languages, repelled Asians who wanted to do business in Australia with racist comments, and so on.

It was a long list, and, as an Australian who lived for decades in the region, a familiar one as well. But did he have a point?

First, on racism, count me as half glass full on this issue. I don’t want to be Pollyannaish about the problem. Racism has a long history in Australia and will not dissipate overnight. Australia has always had its bigots and always will.

But in the past 30 years, a period my letter writer and I were living in the region, Australia has also become an ever more multicultural society which is also relatively harmonious. That is a rarity in today’s world.

But the letter writer left something out which has always bothered me in reading stories in the Asian press about Australian racism.

If the odd outbreak of racism is enough to hobble one’s economy, then a lot of countries in the region are going to go down the drain. Does my letter writer ever read Japanese newspapers, which are full of casual racist slurs? Look at how some Hong Kongers talk about the mainland Chinese and vice versa, and so forth. There may be a higher bar for white Western countries like Australia which long carried a sense of superiority, and I understand that. But Asia, including China, is full of racial sneering, although it is often packaged in the language of regional rivalry and cultural disdain.

On the economy, the letter writer is on surer ground, at least descriptively. Australia, in the main, does business ‘with’ China, not ‘in’ China to take the example of the country’s number one trading partner. In other words, Australian companies, like the big miners and farmers, sell their goods in bulk to China but have relatively few executives on the ground running their businesses day-to-day.

American, Japanese and European multinationals all have battle-hardened executives with experience of running companies in China over decades. Australia has little of that, largely because it doesn’t have many multinationals in the first place.

So maybe, then, guilty as charged on some accounts.

Because of the country’s insularity, a trait reinforced by distance, culture as well as the domestic focus of the economy, Australian business is not nearly as intertwined in regional commerce as it could be. Put another way, Australia profits from China, but in relatively passive fashion.

Still, the country is increasingly intertwined with China in ways that are irreversible. In terms of migrants, students and tourists, Australia already has a Chinese complexion. In business, too, the same applies. Just about every stock listed on the Australian Stock Exchange (ASX) is exposed to China in one way or another. When funds managers are looking to short China, they can just short Australian resource stocks, or, indeed, the entire index. Australia is enmeshed with China in another way that many overlook. In politics, as any visitor to the country quickly notices, China is front page news every day, much as it is in Hong Kong and Singapore.

So my angry letter writer is half right. The test is whether his criticisms become increasingly wrong in the future.

Richard McGregor is a senior fellow at the Lowy Institute and the author of books on Chinese politics and foreign policy, ‘The Party’ and ‘Asia’s Reckoning’.

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